2019 Annual Report

Changing Tastes

Contents Report Methodology & Background

Introduction

Overall Soft Drinks

Bottled Water

Carbonates

Dilutables

Fruit Juice

Sports & Energy Drinks

Still & Juice Drinks

Member Initiatives

Contact

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07

09

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Sources

Official production and trade statistics

Face-to-face interviews with leading soft

drinks producers

Interviews with retailers, distributors and

associated industries

Consumer surveys

Quarterly monitoring of product offered

in all trade channels in selected markets

Regular: 31 and over kcal per 100ml

Mid-Calorie: 21-30 kcal per 100ml

Low- & No-Calorie: 0-20 kcal per 100ml*

Industry terms

*Nutrition Claims Annex of Regulation (EC) 1924/2066

Report Methodology & Background

In line with its European colleagues, the British Soft Drinks Association commissioned food, drink and retailing data analyst Global Data to produce its 2019 report.

The key strength of Global Data’s methodology is that it works in industry

partnerships across the value chain, from suppliers to brand producers and

both on- and off-premise channels. The research is built from brand data

upwards. The ‘brick-by-brick’ approach ensures that the research gives

insights from all angles; from brand volume through to corporate volume,

flavour segmentation, packaging splits and channel distribution. The

companies whose brands are featured in the individual market categories

are selected through regular market observation based on the size of their

output and/or their dynamism.

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Introduction Despite the introduction of the Soft Drinks Industry Levy (SDIL) in April 2018, the UK soft drinks sector demonstrated its resilience and continued capacity for growth with volume sales rising by 3.9% last year. Inevitably, SDIL played its part in an 8.6% increase in value sales in the same period.

Innovation abounds among our manufacturer members, many of whom

have been cultivating their low- and no-calorie ranges for a significant

number of years. At a time when alcohol consumption is falling, consumers

have a range of exciting options that cater to their evolving tastes and

dietary preferences. Meanwhile, Kantar Worldpanel data shows sugar

intake from soft drinks fell by 30.4% between May 2015 and May 2019. This

emphasises that the sector is taking seriously the issue of tackling obesity,

and leading the way in the wider food and drink sector.

The soft drinks industry is also spearheading change on the recycling

front. Our members’ products are 100% recyclable, but we know more

can be done. We have been working closely with the Scottish Government

to develop its deposit return scheme (DRS), which is currently under

construction and due to be introduced in 2021. However, we are concerned

about the feasibility of introducing a well-designed and effective DRS in

such a short timeframe, and we have urged the Scottish Government to

reconsider its proposed timescale. We continue to believe a GB-wide full

DRS for all plastic and can beverage containers remains the best way to

increase recycling levels, and to this end, we will continue liaising with the

UK Government in an effort to achieve this.

BSDA Director General

Gavin Partington

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Overall Soft Drinks

Six-year comparison

2013 2014 2015 2016 2017 2018

Volume M Litres 13,474 13,414 13,569 2,465 13,540 14,064

YOY Growth (%) 0.7 -0.4 -0.1 1.3 -0.2 3.9

Litres Per Capita 210.2 207.7 205.8 206.9 205.1 211.5

Value M GBP 14,105 14,335 14,169 14,310 14,949 16,234

Value YOY Growth (%) 3.8 1.6 -1.2 1.0 4.5 8.6

Value Per Capita (£) 220.0 221.9 217.6 218.2 226.4 244.2

Source: Global Data

2018 statistics

Volume M Litres

14,064

YOY Growth (%)

3.9Litres Per Capita

211.5Value M GBP

16,234Value YOY Growth (%)

8.6Value Per Capita (£)

244.2

Carbonated drinks, still and juice drinks, dilutables, fruit juices, bottled waters, sports and energy drinks.

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Source: Kantar Worldpanel

Overall Soft Drinks 2018

Calorie split

1 Low- & No-Calorie 65.3%2 Regular 27.6%3 Mid-Calorie 7.1%

Category split

1 Carbonated Soft Drinks 37.8%2 Bottled Water 21.2%3 Dilutables 21.0%4 Still & Juice Drinks 7.4%5 Fruit Juice 6.6%6 Sports & Energy Drinks 6.0%

Packaging split

1 PET/Plastic 71.1%2 Metal 12.5%3 Carton 5.6%4 Dispense 4.1%5 Glass 4.1%6 Others 2.6%

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Sugar intake from overall soft drink consumption fell by 30.4% between May 2015 and May 2019.

30.4%

Bottled Water

Six-year comparison

2013 2014 2015 2016 2017 2018

Volume M Litres 2,066 2,263 2,465 2,694 2,815 2,988

YOY Growth (%) 5.4 9.6 8.9 9.3 4.5 6.1

Litres Per Capita 32.2 35.0 37.9 41.1 42.6 44.9

Value M GBP 1,066 1,179 1,274 1,353 1,448 1,520

Value YOY Growth (%) 6.8 10.6 8.1 6.2 7.0 4.9

Value Per Capita (£) 16.6 18.3 19.6 20.6 21.9 22.9

Share of Total Soft Drinks (%) 15.3 16.9 18.4 19.9 20.8 21.2

Source: Global Data

2018 statistics

Volume M Litres

2,988

YOY Growth (%)

6.1Litres Per Capita

44.9Value M GBP

1,520Value YOY Growth (%)

4.9Value Per Capita (£)

22.9

21.2Share of Total Soft Drinks (%)

Still, sparkling and lightly carbonated natural mineral waters, spring waters and bottled drinking waters packaged in sizes of 10 litres or below; water for coolers in sizes of 10.1 litres and above.

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Bottled Water 2018

Water source split

1 Mineral 65.0%2 Spring 29.9%3 Bottled Drinking Water 5.1%

Water type split

1 Still 75.6%2 Sparkling 14.1%3 Cooler 10.3%

Packaging split

1 PET/Plastic 95.1%2 Glass 4.9%

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Bottled Water remains one of the fastest-growing soft drinks categories. In 2018, volume sales increased by 6.1%

6.1%Source: Global Data

Carbonates

Six-year comparison

2013 2014 2015 2016 2017 2018

Volume M Litres 5,351 5,240 5,201 5,192 5,168 5,314

YOY Growth (%) -0.2 -2.1 -0.7 -0.2 -0.5 2.8

Litres Per Capita 83.5 81.1 79.9 79.2 78.3 79.9

Value M GBP 6,558 6,493 6,473 6,443 7,060 7,950

Value YOY Growth (%) 3.0 -1.0 -0.3 -0.5 9.6 12.6

Value Per Capita (£) 102.3 100.5 99.4 98.3 106.9 119.6

Share of Total Soft Drinks (%) 39.7 39.1 38.8 38.3 38.2 37.8

2018 statistics

Volume M Litres

5,314

YOY Growth (%)

2.8Litres Per Capita

79.9Value M GBP

7,950Value YOY Growth (%)

12.6Value Per Capita (£)

119.6

37.8Share of Total Soft Drinks (%)

Ready-to-drink carbonates, including draught and home dispense: regular-, mid- and low- & no-calorie; cola; lemon, including lemonade; lemon-lime; mixers, including tonic and bitter drinks; orange; shandy; sparkling juices; and others including various carbonated fruit flavours, sparkling flavoured water, health drinks and herbal drinks.

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Source: Global Data

Carbonates 2018

Calorie split

1 Low- & No-Calorie 54.5%2 Regular 37.5%3 Mid-Calorie 8%

Flavour split

1 Cola 55.8%2 Others 19.8%3 Clear Lemonade 8.2%4 Orange 6.6%5 Tonic, Mixers & Bitters 5.4%6 Lemon-Lime 4.2%

Packaging split

1 PET/Plastic 57.4%2 Metal 27.2%2 Dispense 10.9%3 Glass 4.5%

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The sugar in Carbonates fell by 37.6% between May 2015 and May 2019

37.6%Source: Kantar Worldpanel

Dilutables

Six-year comparison

2013 2014 2015 2016 2017 2018

Volume M Litres 3,173 3,041 2,882 2,827 2,768 2,947

YOY Growth (%) -0.7 -4.2 -5.2 -1.9 -2.1 6.4

Litres Per Capita 49.5 47.1 44.3 43.1 41.9 44.3

Value M GBP 851 881 757 768 741 859

Value YOY Growth (%) 3.5 3.4 -14.0 1.4 -3.5 15.9

Value Per Capita (£) 13.3 13.6 11.6 11.7 11.2 12.9

Share of Total Soft Drinks (%) 23.5 22.7 21.5 20.8 20.4 21.0

2018 statistics

Volume M Litres

2,947

YOY Growth (%)

6.4Litres Per Capita

44.3Value M GBP

859Value YOY Growth (%)

15.9Value Per Capita (£)

12.9

21.0Share of Total Soft Drinks (%)

Squashes, cordials, powders and other concentrates for dilution to taste by consumers, expressed as ready to drink (RTD). Typically adding four parts water to one part product for single concentrates, nine parts water to one part product for double concentrates and varying amounts for super concentrates with 50-70ml making 5-7 litres RTD.

Source: Global Data

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Dilutables 2018

Calorie split

1 Low- & No-Calorie 88.3%2 Mid-Calorie 6.7%3 Regular 5.0%

Flavour split

1 Orange 33.8%2 Flavour Mixes 31.0%3 Apple 14.7%4 Others 13.9%5 Berries 6.6%

Packaging split

1 PET/Plastic 95.7%2 Glass/Others 4.3%

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The sugar in Dilutables decreased by 54.6% between May 2015 and May 2019

54.6%Source: Kantar Worldpanel

Fruit Juice

Six-year comparison

2013 2014 2015 2016 2017 2018

Volume M Litres 1,095 1,012 960 940 927 929

YOY Growth (%) -5.6 -7.6 -5.1 -2.0 -1.5 0.2

Litres Per Capita 17.1 15.7 14.7 14.3 14.0 14.0

Value M GBP 1,972 1,929 1,800 1,823 1,801 1,787

Value YOY Growth (%) 1.6 -2.2 -6.7 1.3 -1.2 -0.8

Value Per Capita (£) 30.8 29.9 27.6 27.8 27.3 26.9

Share of Total Soft Drinks (%) 8.1 7.5 7.2 6.9 6.8 6.6

2018 statistics

Volume M Litres

929

YOY Growth (%)

0.2Litres Per Capita

14.0Value M GBP

1,787Value YOY Growth (%)

-0.8Value Per Capita (£)

26.9

6.6Share of Total Soft Drinks (%)

100% fruit content equivalent, sometimes referred to as pure juice or 100% juice. Chilled juice comprises four main types: freshly squeezed juice; not from concentrate juice; chilled from concentrate (which can be from concentrate or part from concentrate); and smoothies. Ambient or long-life juices are mainly from concentrate.

Source: Global Data

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Fruit Juice 2018

FC/NFC split

1 From Concentrate 60.8%2 Not From Concentrate 39.2%

Flavour split

1 Orange 62.4%2 Others 16.2%3 Apple 13.7%4 Pineapple 4.0%5 Berries 3.7%

Packaging split

1 Carton 66.9%2 PET/Plastic 31.5%3 Glass/Others 1.6%

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Fruit Juice saw volume sales grow by 0.2% in 2018

0.2%Source: Global Data

Sports &Energy Drinks

Six-year comparison

2013 2014 2015 2016 2017 2018

Volume M Litres 740 772 794 802 802 844

YOY Growth (%) 4.1 4.3 2.8 1.0 0.1 5.2

Litres Per Capita 11.5 12.0 12.2 12.2 12.2 12.7

Value M GBP 2,046 2,176 2,223 2,252 2,278 2,442

Value YOY Growth (%) 5.8 6.4 2.2 1.3 1.2 7.2

Value Per Capita (£) 31.9 33.7 34.1 34.3 34.5 36.7

Share of Total Soft Drinks (%) 5.5 5.8 5.9 5.9 5.9 6.0

Source: Global Data

2018 statistics

Volume M Litres

844

YOY Growth (%)

5.2Litres Per Capita

12.7Value M GBP

2,442Value YOY Growth (%)

7.2Value Per Capita (£)

36.7

6.0Share of Total Soft Drinks (%)

Carbonated Sports Drinks Drinks that enhance physical performance before, during or after physical/sporting activity. Sports drinks replace fluids and electrolytes/minerals lost by sweating and supply a boost of carbohydrate: isotonic (fluid, electrolytes and 6-8% carbohydrate), hypotonic (fluids, electrolytes and a low level of carbohydrate) and hypertonic (a high level of carbohydrate).

Energy Drinks Traditional glucose-based energy drinks: functional or stimulation energy drinks which claim a particular energy boost from caffeine, guarana, taurine and ginseng or other herbs or some combination of these ingredients.

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Source: Global Data

Sports & Energy Drinks 2018

Sports/Energy split

1 Energy Drinks 83.4%2 Sports Drinks 16.6%

Calorie split

1 Regular 62.0%2 Mid-Calorie 21.9%3 Low- & No-Calorie 16.1%

Packaging split

1 Metal 52.9%2 PET/Plastic/Glass 47.1%

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Energy Drinks achieved a volume sales growth of 5.2% in 2018

5.2%

Still & Juice Drinks

Six-year comparison

2013 2014 2015 2016 2017 2018

Volume M Litres 1,049 1,087 1,100 1,114 1,059 1,042

YOY Growth (%) 5.0 3.6 1.2 1.3 -4.9 -1.6

Litres Per Capita 16.4 16.8 16.9 17.0 16.0 15.7

Value M GBP 1,612 1,678 1,642 1,671 1,621 1,676

Value YOY Growth (%) 5.4 4.1 -2.2 1.8 -3.0 3.4

Value Per Capita (£) 25.2 26.0 25.2 25.5 24.5 25.2

Share of Total Soft Drinks (%) 7.8 8.1 8.2 8.2 7.8 7.4

Source: Global Data

2018 statistics

Volume M Litres

1,042YOY Growth (%)

-1.6Litres Per Capita

15.7Value M GBP

1,676Value YOY Growth (%)

3.4Value Per Capita (£)

25.2

7.4Share of Total Soft Drinks (%)

High fruit juice (25-99% fruit content); juice drinks including juicy water (5-30% fruit content) and other still drinks (0-5%) including iced tea, still flavoured water and non-fruit drinks.

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Still & Juice Drinks 2018

Calorie split

1 Low- & No-Calorie 51.3%2 Regular 31.6%3 Mid-Calorie 17.1%

Category split

1 Still Drinks 47.9%2 Flavoured Waters 30.9%3 High Fruit Juice (Nectars) 14.3%4 Juicy Waters 6.9%

Packaging split

1 PET/Plastic 69.6%2 Carton 18.2%3 Foil Pouch 7.1%4 Glass/Metal 5.1%

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The sugar in Still & Juice Drinks fell by 54.0% between May 2015 and May 2019

54.0%Source: Kantar Worldpanel

Member InitiativesPepsiCo

PepsiCo has supported the launch of the ‘Keep it, Bin it’ anti-litter partnership between Defra and Keep Britain Tidy.

The campaign uses shocking images to call time on the millions of pieces of

litter dropped each day across England.

Launched by Environment Secretary Michael Gove and Keep Britain Tidy,

Keep it, Bin it features poignant images of wildlife eating and getting tangled

in litter, contrasted against typical excuses people give for dropping litter.

The aim is to make littering culturally unacceptable within a generation. To

support the campaign, PepsiCo has donated advertising space in cinemas

nationwide. The advertisements seek to encourage young people to put their

litter in a bin or keep hold of it until they see one.

In addition to cinemas, the campaign has been on display in train stations

nationwide, including commuter hubs such as London Euston, Manchester

Piccadilly and Birmingham New Street, across partners’ social media

channels and at till-points in Gregg’s stores.

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Member InitiativesLucozade Ribena Suntory

Lucozade Ribena Suntory (LRS) has joined forces with ‘sport for development charity’ Active Communities Network to launch B Active and bring to life a shared ambition of inspiring young people through sport.

The sports programme, backed by the LRS Movement Fund, is geared

towards improving the lives and prospects of thousands of young people

aged between 16 and 24 by providing regular access to sport and education.

Those engaged with the programme have had the opportunity to enjoy

sessions in a range of physical activities including football, basketball, fitness

and netball. The sessions run five days a week, 50 weeks of the year across

areas of Britain where levels of social and economic deprivation are high.

As well as offering the physical benefits of sport and physical exercise, B

Active is giving young people the opportunity to broaden their horizons

through a range of vocational courses. It has so far awarded accreditation

to more than 1,000 young adults, a third of whom have gone on to secure

employment through the programme.

Ensuring B Active leaves a lasting legacy on UK communities, LRS has also

invested in a three-year academic study to closely examine behavioural

change over this period. The findings will be used to inform government

policy and demonstrate the value of sport for development programmes.

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British Soft Drinks Association20-22 Bedford RowLondonWC1R 4EB

Telephone +44 (0) 20 7405 0300Email bsda@britishsoftdrinks.comWebsite www.britishsoftdrinks.comTwitter @BritSoftDrinks